MNTN Q3 2026 Earnings Call Transcript

MNTN (NYSE:MNTN) reported third-quarter financial results on Wednesday. The transcript from the company’s third-quarter earnings call has been provided below.

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Summary

MNTN reported third quarter revenue of $80.3 million, below the guidance range of $86 to $89 million. Adjusted EBITDA was also below expectations at $19.9 million versus guidance of $22 to $25 million.

The company underwent significant changes in its salesforce structure, leading to attrition and a reduction in new business acquisition and resulting in lowered future revenue and EBITDA guidance for Q4.

Tony Weissman has been appointed as the new CEO, with a focus on improving operational rigor, addressing sales execution issues and aligning the company on common metrics to drive growth.

The company saw a 15% year-over-year revenue increase, maintained gross margins at 79% and achieved positive net income of $7.7 million, with GAAP EPS of $0.10.

Strategic initiatives include correcting sales compensation plans, hiring new sales executives from Salesforce and Snap, and maintaining a strong customer expansion rate over 115%.

Full Transcript

OPERATOR

If you would like to ask a question, please raise your hand. If you have dialed into today’s call, please press star-nine to raise your hand and star-six to unmute. I will now hand the conference over to Brynlee Johnson. Please go ahead.

Brynlee Johnson (Investor Relations)

Good afternoon and thank you for joining us for MNTN’s third quarter 2026 earnings call. With me today are Joe Kaiser, MNTN’s Lead Independent Director, Tony Weissman, CEO, and Patrick Cohen, CFO. Just to remind everyone, today’s call includes forward-looking statements that are subject to risks and uncertainties and actual results could materially differ from those anticipated in these forward-looking statements. For the risks and uncertainties that may affect future results, please see our most recently filed periodic report which is also available on our website.

We will also discuss non-GAAP financial measures on today’s call. Reconciliations of these measures are available in our earnings materials on our website. With that, I will turn the call over to Joe. Please go ahead.

Joe Kaiser (Lead Independent Director)

Thank you for joining us. I’m MNTN’s Lead Independent Director. As you surely saw in the press release we issued a little while ago, Tony Weissman has been appointed MNTN’s new CEO effective November 2nd. The Board determined it was time to bring more operational rigor to the business and asked Tony to step in as CEO. Tony joined MNTN’s Board earlier this year and he has the unwavering support of MNTN’s Board to lead the company at this time. As a career marketer, Tony brings the voice of the customer to MNTN. From his time leading Digitas and serving as Chief Marketing Officer of Dunkin, Tony understands the decisions our customers make about where to spend their advertising dollars. With that, please join me in welcoming our new CEO, Tony Weissman.

Tony Weissman (Chief Executive Officer)

Thanks, Joe. Let’s start with the numbers. Third quarter revenue was $80.3 million compared with the company’s guidance of $86 to $89 million. Adjusted EBITDA was $19.9 million compared with guidance of $22 to $25 million. For the fourth quarter we expect revenue to be between $75 and $78 million and adjusted EBITDA to be between $8 and $10 million. Our Q3 results and outlook are disappointing. We have much higher expectations at MNTN. Before accepting this role, I reviewed the business including product–market fit, customer demand, our technology and our sales motion. I wanted to understand what had changed and whether we had a practical path to address it. I concluded the issue was exclusively go-to-market execution. The company recently made significant changes in the sales team that did not work out, most notably a new compensation structure modeled after the biggest platforms in our industry like Google and Meta.

They were implemented too quickly, resulting in salesforce attrition. We lost about 40% of our experienced quota-carrying sellers, reducing our ability to bring in new business. We’ve since corrected the compensation plans. We’ve also hired 16 new sellers and our first new-hire class starts later this month. Additionally, we’ve added two proven executives, Lynn Kanak from Salesforce leading Brand Sales and Frank Lee from Snap leading Agency Sales. They both report to me. It will take time for these sellers to fully ramp and our updated outlook assumes that the disruption we saw in Q3 will continue into Q4. Our new leaders have instilled more discipline around hiring, training and supervision, resulting in increased new starting budgets.

We’ve changed the leadership behind the decisions that got us here. Chris Innes and Garland Hill are no longer with MNTN. I’ve spent my career on the advertiser side of the table. MNTN does what marketers have always wanted: reach the right people and measure the return on their advertising stack in a category full of complexity. I love how MNTN keeps it simple. We provide one frictionless platform that allows customers to invest in the CTV channel with clarity, simplicity and accountability. Our technology, experience and data help them decide which messages to run, how to allocate their budgets and how to measure results all in one place as easily as they buy on Meta or Google.

And we give them the attribution they’ve come to expect, tying their TV spend to site visits and sales. I believe our opportunity for growth remains strong. MNTN is a performance channel like search and social. Combined with the power of television, it’s the ultimate business-driving platform. What MNTN needs is operational rigor. To achieve our goals, I plan to take a threefold approach. 1) Identify the opportunities and the weaknesses early and address them quickly. 2) Get the right leaders in charge of each team. 3) Make sure everyone is aligned on common metrics and working together for measurable results.

I will rigorously review pipeline growth, conversion of demos into paying customers and starting budgets with the team. I plan to judge our progress by whether those improvements translate into sustained customer spending and recurring. I plan to move quickly and decisively. I’ve also begun to make changes to our leadership team. I’m pleased to announce that Anna Sayer, who led marketing at The Trade Desk for seven years, joined us this week as MNTN’s Chief Marketing Officer. She’ll make our offerings salient to generate new customer growth. Finally, I excel at building cultures of accountability where the teams are focused on execution. I’ve been delighted to learn that some of the best industry talent is already inside our company and I’m committed to giving them the support and guidance to perform at their best.

Let me wrap up by saying that I know we have to earn back your confidence. While we’re hiring and onboarding salespeople now, it will take time for these sellers to fully ramp. Our outlook reflects this. When we report fourth quarter results, I’ll lay out our 2027 operating plan and outlook, the measures we’ll use to assess progress and what our changes have delivered to that point. Patrick, over to you to walk through the numbers and the outlook, and then we will take your questions.

Patrick Cohen (Chief Financial Officer)

Thank you, Tony. Our third quarter revenue increased to $80.3 million, up 15% year over year. Revenue growth this quarter was impacted by unforeseen execution disruption in our go-to-market organization. Third quarter gross margins remained consistent at 79%, flat with the prior year period. Our expansion rate, which measures the spend of our current customers as compared to those same customers’ spend a year ago, remains quite healthy and is still well north of 115%.

Total operating expenses for the third quarter decreased by $4.7 million sequentially to $54.5 million. This was primarily driven by a decrease in personnel costs as a result of the reduction in force in the second quarter and a one-time stock-based compensation award that also occurred in the second quarter. For the third quarter we achieved positive net income of $7.7 million for a GAAP EPS of $0.10, compared to a net income of $6.4 million and GAAP EPS of $0.09 in the prior year period.

Adjusted EBITDA for the quarter increased to $19.9 million, up from $16 million in Q3 of 2025, an increase of 24%. The company’s adjusted EBITDA margin grew to 24.8%, up 200 basis points compared to 22.8% in Q3 of 2025. We plan on continuing to make disciplined investments in sales and marketing, specifically in experienced hires to drive broader customer adoption. We expect sales and marketing expenses to increase approximately 10% sequentially as we add qualified salespeople. Our balance sheet remains strong and we ended the quarter with $252 million in cash and cash equivalents with no borrowings outstanding. We ended the quarter with 75.8 million shares outstanding.

We are reducing our fourth quarter and full-year outlook to reflect ongoing changes to our go-to-market organization. It will take time for sellers to fully ramp and our guidance assumes that the disruption we saw in Q3 will continue into the fourth quarter. For Q4 we expect revenue to be between $75 and $78 million. We expect adjusted EBITDA to be between $8 and $10 million. Our fourth quarter guidance includes additional non-recurring general and administrative expenses related to our executive personnel changes.

For the full year 2026, we are lowering our revenue guidance range to $311 million to $314 million, representing 10% year-over-year growth at the midpoint. Excluding the impact of the Maximum Effort divestiture, we expect adjusted EBITDA to be between $66 and $68 million. We are basing the revised outlook on our expectation for how the business will perform as we realign the go-to-market organization around our priorities. We’ll provide more detail on the operating plan and the outlook for 2027 when we announce our fourth quarter and fiscal year results. With that said, we’ll open the line for questions.

OPERATOR

We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please raise your hand. If you have dialed into today’s call, please press star-nine to raise your hand and star-six to unmute. Please stand by as we compile the Q&A roster. And your first question comes from the line of Matthew Weber with Canaccord. Your line is open. Please go ahead.

Matthew Weber (Analyst)

Hi, good afternoon and thanks for taking the question. And Tony, welcome. Welcome to the call. I guess just to start off, you’ve seen the business from the Board, so you’ve had a view from the inside. What gives you the confidence that this is an execution problem rather than a demand or a competitive one? And then I have a follow-up.

Tony Weissman (Chief Executive Officer)

Thank you, Matthew. I appreciate the welcome. I’ve studied this business for quite some time and I know that it’s delivering value to our customers, many of whom have been with us for a very long time, and it has proven to be one of the most effective ROAS channels. And of course, the growth in the market underscores the overall interest in this space. I’m confident that MNTN has terrific product–market fit, a terrific team, a great brand, and certainly the heritage of having essentially invented this space.

The more I dug, the more I realized that it was decisions that were made in our own sales organization, primarily leading to attrition, that caused this slowdown. And those strike me as problems that are being fixed and can be addressed quickly so that we can get back to the historical growth we’ve seen.

Matthew Weber (Analyst)

Thank you, that’s very helpful. And then just is there any incremental color that you can share with us in terms of what specifically those changes were to the compensation structure and what the thought process was going into them and how you’ve corrected today? Thanks so much.

Tony Weissman (Chief Executive Officer)

Sure. When Garland joined the company from TikTok, there was a desire to move the sales organization to models that are underway at bigger platforms like TikTok, Google, Meta. There was verticalization that was deployed poorly and too quickly. There was a change in incentives from revenue to activity, and there was a change in the frequency with which sellers were paid. These were told to the team in late Q2, but implemented at the beginning of Q3, and it just didn’t work for many of the sellers who felt disaffected.

They felt like their opportunity for earning had been diminished and that’s what led to the attrition.

Matthew Weber (Analyst)

Got it. Thank you.

OPERATOR

Thank you. Your next question comes from the line of Andrew Merrick with Raymond James. Your line is open. Please go ahead.

Andrew Merrick (Analyst)

Hi. Thanks for taking my questions. Two if I could. So maybe again on the culture reset and the operational rigor that you were talking about, is there anything else beyond the salesforce compensation structure that you were alluding to that you wanted to put your stamp on the business in a particular way? And then I have a follow-up after that.

Tony Weissman (Chief Executive Officer)

Thank you for the question. My analysis has determined that that is the number one issue and the first thing that needs to get addressed, and the thing I’m most focused on most immediate. Across the board, I believe there was an opportunity for the company to operate with a greater focus on outcomes, a higher level of accountability, and more transparency across the company on the metrics that matter and that we’re all pulling in the same direction.

So I’ve started to put some of those in place so that we have common dashboards reporting real-time insights that are relevant to the growth of the business. I think that just falls in general under an approach of accountability, transparency, and holding people responsible.

Andrew Merrick (Analyst)

Got it. All right, thank you for the color there. And then one more if I could, just on some of these salesforce issues, is there any way to disaggregate what you were seeing in terms of new customers versus existing customer spend and the shortfalls that each of those buckets attributed? Thank you.

Tony Weissman (Chief Executive Officer)

The overwhelming impact was on new customers. And that’s because, excuse me, the frontline sellers were the ones where the attrition was. By contrast, many of our current customers retained and continued to expand and we continue to see very high levels of satisfaction and performance of that group. So it was predominantly in the net new.

Andrew Merrick (Analyst)

Great, thank you.

OPERATOR

And your next question comes from the line of Robert Kohlberth with Evercore ISI. Your line is open. Please go ahead.

Robert Kohlberth (Analyst)

Great. Thank you very much for taking the question. Welcome, Tony. So just want a couple here. Maybe, Patrick first, could we just talk about the gross expansion rate versus the net? It sounds like the gross remains quite healthy. But have you seen any changes in the net expansion rate, any uptick in churn, that maybe speaks to the issues that we’re seeing, maybe in the Q4 guide in particular? And then, Tony, in your review, it sounds like you did some diligence maybe before taking on the role. Just wondering if you could maybe give us your assessment of the evolving competitive set. There are a couple small players in the space who were recently acquired by much larger organizations. I was just wondering if that is at all weighing on the company’s results or affects the way that you think MNTN has to grow and respond to market dynamics going forward.

Thank you.

Patrick Cohen (Chief Financial Officer)

Robert, so the expansion rate, which as you recall measures customers in a 12-month period — so in this case ending September 30, 2026, going back 12 months, finding a customer in the prior 12-month period and seeing how much they’ve expanded their spend — that has been well north of 115% and continues to be well north of 115%. We don’t really use NRR internally because we went down market to the small businesses, but they continue to churn more than the mid-sized market, which is the core of our business.

Tony Weissman (Chief Executive Officer)

Hi Robert, thanks for the question. On the competitive front, I do not believe that that has been a factor. In head-to-head pitches, we are winning at the same rate that we were in the past. The issue is there weren’t enough opportunities — there were not enough new opportunities. I think the dynamics in the industry that you refer to, some of our competitors being acquired by larger platforms, is going to play out in such a way that potential customers are going to wonder about the difference between MNTN, which is a purely independent platform that only cares about the customer’s growth, and some of these others and wonder where their data is going and whose interests they’re serving. So I believe that’s an opportunity for us in the future to even grow greater share.

Robert Kohlberth (Analyst)

Okay, thank you very much.

OPERATOR

And your next question comes from Andrew Boone with Citizens. Your line is open. Please go ahead.

Andrew Boone (Analyst)

Thanks so much for taking the questions, Tony. What I’m trying to understand here is the direction of the business on a go-forward, and so I want to go backwards in terms of some of the things that we understood previously about MNTN and what you’re saying today. So one of the key themes was self-signup in the past in terms of MNTN, and it sounds like this is really a sales execution. Can you help us understand the evolution of what you guys need the sales team to be within a self-signup environment, or whether sales was more important there?

Just tie the historical messaging to now the sales execution.

Tony Weissman (Chief Executive Officer)

Thanks for the question. There’s still going to be an opportunity for that motion, obviously for certain types of size customers, and we want to be best in class in providing that level of service and doing it in a seamless, easy-to-use way. Customers still continue to sign up and request demos, and the sales team fields those as inbound. What we did had the highest impact on the non–self-serve opportunities, where sellers and demos that were brought in from the team themselves fell well below the volumes that we had seen historically in the past.

So that’s the area that we’re focusing on: the right hiring and the right training to get those folks on board so that they are quota-carrying going forward, and we’re going to continue to operate both motions going forward.

Andrew Boone (Analyst)

That’s helpful. And then I’d love to ask around the direction that’s implied with the hires. So with Lynn Kanak coming over from Salesforce who led Brand, and Frank Lee from Snap that led Agency Sales, it feels like there may be a change in direction where you guys are broadening out the platform from performance. Is that right? And then, can you step back — and understood you’ve been in the role for two days — but do you have any inclination around where you want to move the boat on a go-forward direction as we think about the broader opportunity for MNTN and where you want to take that ship?

Thank you.

Tony Weissman (Chief Executive Officer)

Let me clarify. Brand is inside sales. So we’re using the term to describe direct sales from our team directly to the marketer for Lynn’s team, whereas Frank’s team is working with agencies. So the Brand term there may be misleading because we are not looking to generate what would traditionally be considered as top-of-funnel or high awareness any differently than we have in the past. It’s the distinction between the channels. I hope that clarifies that.

I think the key to the future for this business lies in being seen as the undisputed leader to deliver performance across every need that a customer might have, giving them a broad array of channels to choose from with the right message, the right time and the right spend level to optimize the ROAS. This is a growing channel. We have the opportunity to be the premier partner, whether directly to a brand or to a performance agency. And I think my vision is for us to be seen as the most viable, predictable partner that any of them could possibly have.

We are customer-obsessed and our success, our growth, is a function of theirs. I think the opportunity lies right ahead of us.

Andrew Boone (Analyst)

Thank you.

OPERATOR

There are no further questions at this time. I will now turn the call back to management for closing remarks.

Tony Weissman (Chief Executive Officer)

Thank you all for the welcome today and thank you for joining us. I’m looking forward to getting to know each of you better and learning from your perspective and having an ongoing dialogue as we pursue the plans that we’ve outlined. I really appreciate your time and attention today, and thank you for joining us.

OPERATOR

This concludes today’s call. Thank you for attending. You may now disconnect.

Disclaimer: This transcript is provided for informational purposes only. While we strive for accuracy, there may be errors or omissions in this automated transcription. For official company statements and financial information, please refer to the company’s SEC filings and official press releases. Corporate participants’ and analysts’ statements reflect their views as of the date of this call and are subject to change without notice.